Kirk Caldwell beat out the anti-rail candidate by more than 22,000 votes -- 54 to 46 percent.

Although the election for Honolulu mayor was his last political race, Cayetano says he won't go quietly.

Cayetano always said his path to victory depended on high voter turnout.

When reports came in that nearly 20 polling sites had run out of ballots, Cayetano remained optimistic.

"If this is an indication that the turnout is, in fact, high, we feel we have a better shot at winning," said Cayetano.

But, as Barack Obama celebrated his reelection in Chicago, it was clear Cayetano would suffer his first political loss.

"I'm 8-1 now. That's not too bad either," said Cayetano.

The former two-term Democratic governor said the race for Honolulu mayor will be the one campaign he remembers the most -- not because it was hard-fought but because of what he labels as a $2.8 million smear campaign by the Pacific Resource Partnership.

"This election will usher in a new era in Hawaii politics," said Cayetano.

Cayetano said his defamation lawsuit against PRP will continue, and he plans on following the progress of the rail project and Caldwell as mayor.

"I think we should hold him accountable for all the promises that he made," said Cayetano.